The two-day global stock surge came to a halt this morning following further escalations in the US-China trade war. The Trump administration slapped fresh curbs on Nvidia chip exports to China which saw NVIDIA shares tumble post market.
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The doom and gloom from the NVIDIA announcement has weighed on global stocks and indexes. Chinese technology companies drove Asian equities lower, while equity index futures in Europe and the US both struggled.
Japan’s 30-year bonds recovered as U.S. Treasury market volatility eased, and BoJ’s Ueda suggested a possible reaction to higher U.S. tariffs. However, a weak economy could threaten the BoJ's plans to slowly raise interest rates.
The only positive outcome during the Asian session appears to be around China. China's economy grew faster than expected in the first quarter, driven by strong consumer spending and industrial production.
Gold prices stole the show once again as the precious metal is trading within a whisker of $3300/oz, having risen around 1.82% to trade $3290/oz at the time of writing.
The DXY resumed its struggle following a brief reprieve yesterday which saw the greenback gain around 0.50%. The Euro and Swiss Franc appear to be the biggest gainers from the NVIDIA ban, both gaining in Asian trade.
Looking at the European session, the chances that European tech shares follow their Asian and US counterparts are high. We are already seeing weakness in index futures with the DAX trading 0.85% down at the time of writing.
Economic data releases
From a data perspective, we have Eurozone and Italian CPI (final) numbers being released this morning. Neither of these releases should have a major impact on market moves this morning with the overall tariff narrative still front and centre.
For all market-moving economic releases and events, see the MarketPulse Economic Calendar. (click to enlarge)
Chart of the day - DAX
From a technical standpoint, the DAX is at a key level and a critical junction for the index.
Bulls and bears are battling out for supremacy as the index hovers at the 100-day MA eyeing either a break or bounce.
Yesterday saw the DAX end the day in the green but failing to record a close above the 100-day MA.
The overnight announcement around NVIDIA and China weighed on the DAX as well with the Index opening lower today.
Currently the Index is down around 0.85% and faces significant hurdles if it is to reclaim the 22000 handle.
Keep an eye on the period-14 RSI with a break above the 50 level a potential sign that bullish momentum is in play.
A rejection of the RSI 50 level and the 100-day MA could bring support at 21000 and 20550 back into focus.
DAX 40 Index Chart, April 16, 2025
Source: TradingView.com (click to enlarge)
Support
- 21000
- 20550
- 20000
Resistance
- 21365
- 21803
- 22405
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